Candidate targets for-profit colleges

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Milford Daily News

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Posted Feb. 21, 2014 at 6:10 PM

Posted Feb. 21, 2014 at 6:10 PM

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State House News Service

BOSTON - Calling the record of student loan defaults at for-profit colleges a "public policy disaster," Democratic candidate for attorney general Maura Healey on Thursday rolled a plan to address what she described as "predatory lending practices" at schools by enacting stronger regulations and educating the public.

Healey, a former assistant attorney general under Attorney General Martha Coakley, detailed her proposal in an op/ed published Thursday in the Boston Globe. The plan revolves around enacting regulations proposed by Coakley to prohibit "egregious sales tactics" and expand public awareness campaigns to inform prospective students.

"This is the age-old ploy of predators who helped tank our housing market, leaving countless borrowers buried in debt and communities reeling," Healey said in a statement. "We wish we had stopped that financial shell game before it took hold. But we have a chance to make sure we aren’t burned again – this time by the emerging for-profit schools targeting our most vulnerable students, honing in on gateway cities and adding to the growing burden of student debt."

According to Healey’s campaign, dropout rates at some for-profit colleges can exceed 50 percent, and while only 13 percent of those enrolled borrow to pay for school, the institutions are responsible for nearly half of all student loan defaults.

Healey said a U.S. Senate committee investigation into for-profit higher education institutes found that they took in $32 billion in taxpayer-backed student loans and spent 25 percent of it on marketing and recruiting, compared to the 1 percent spent by non-profit colleges. Healey also called for the attorney general’s office to increase enforcement actions against recruiters who lie to prospective students, for state legislation to expand partial tuition refunds for students who withdraw from for-profit schools and to prohibit state education grants and loans for schools with a poor track record.